Guld's Glass, Inc., has three divisions: Commercial, Nonprofit, and Residential. The segmented income statement for the current year revealed the following:
Guld's Glass, Inc.
Divisional Profit Summary and Decision Analysis

1. How will Guld's Glass, Inc., be affected if the Nonprofit Division is dropped?
2. If the Nonprofit Division is dropped, then the sales of the Residential Division will decrease by 10 percent. If this happens, how will Guld's Glass, Inc., be affected?

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Total Commercial Nonprofit Division Residential Division Company $290,000 $533,000 $837,000 $1,660,000 1,054,000 $143,000 98,000 $365,000 606,000 369,000 19,000 S 8,000) $226,000 237,000 168,000 $ 69,000 Division Sales Less variable costs Contribution margin Less direct fixed costs Segment margin Less common fixed costs Operating income 147,000 435,000 472,000 124,000 106,000 139,000